Monday, August 27, 2007

How do book auctions work?

I think there may be some confusion about how books auctions work, what they mean for a book, etc. and I thought I'd talk about them a bit.

Generally, an auction occurs when a submission has been sent out by an agent to multiple editors, and more than one editor is interested in making an offer. When the first editor expresses interest and/or makes an offer, the agent will go to the other editors to see what their interest level is. If two or more editors are interested in making an offer, the agent will usually hold an official auction.

In my experience, there are two main ways an agent will conduct an auction. Prior to the auction, the agent will generally send out an email outlining the rules of the auction. Sometimes this will include a request for a marketing plan. In general, the two types of auctions are Rounds, and the other is Best Offer.

1) Rounds: this is what most people probably think of when they hear "auction"--all of the editors sit in one room with little white cards with numbers on them while the auctioneer talks quickly about the book...just kidding. The auctions all happen over email, phone, or fax. The agent will ask for first offers by a certain date/time, and the highest offer will be treated as the floor. The agent will let all of the other parties know what the floor is (in my experience, this is usually done by phone), and then ask for their next offer. This will keep going until only one winning publisher is left. This type of auction is decided entirely on the advance offered.

2) Best Bids: with this type of auction, the agent will set a date/time and ask for a publisher's best offer. Sometimes this auction is based on the advance to determine the winner, but oftentimes with this type of auction, the agent will state in the "rules" that they reserve the right to take all aspects of the offer into account--the marketing plan, the editor's passion, the publisher and how the book would fit on the list. Occasionally, a lower offer might win out over a higher.

I asked my fellow BRGs if they had any specific questions about book auctions, and here were some of them:

How is it decided when a specific manuscript should be auctioned? The author/literary agent must have some idea there's a sufficient amount of interest in the book. How is word spread about the book initially?I think I addressed the first part of the question above--although I'll add that on occasion, I've had an agent send me a manuscript and tell me that he/she is going to have an auction for the book on a certain date. This generally backfires on the agent,because he/she finds himself without the necessary interest. To be honest, knowing that a book is going to be in an auction affects me in two ways--sometimes it makes me want a book more (if I truly love the project!), and sometimes it makes me want a book less (when I feel that it's not "worth it").

Is it easier to get the other people at a publishing company to act quickly if a book is up for auction than if it is not?Yes, definitely--there is a definite "due date" for an auction book, a day/time that we need to get an offer in, so sometimes this means that I get our acquisitions committee to give something an overnight read. If a book is not up for auction, it goes through the regular acquisitions process which can sometimes take months.

Have the books you've bought at auction earned out their advances?I don't think I'm allowed to answer this question, but I will say that in most/all cases, it's too early to tell. But I'll add here that having a book go to auction doesn't always mean a big advance--sometimes it just means that more than one editor/publishing house has fallen in love with a project. I've won auctions with the type of advance I would have paid without an auction.

Do publishers keep a book in print longer if they paid, say, $60,000 for it than if they paid $10,000?As far as I know, the amount of advance has nothing to do with how long a book it kept in print. It all depends on sales. I will say that if the book gets a huge advance (and I'm not sure if $60,000 would do it), then the book is pretty much guaranteed a significant marketing plan--but this doesn't always equal sales, and it doesn't mean a book will stay in print longer.

How do you as an editor decide if a book is worth bidding on?Pretty much the same way I decide if I want to acquire any book--if I fall in love with it. But in the case of an auction, I have to decide if it's worth getting the committee to read something quickly, worth scheduling separate meetings to discuss, worth dropping everything and concentrating on the project. Some books don't feel like "auction books" in the sense that they're not super commercial and I don't think they're worth huge advances, but on occasion we've bid in auctions for a "quiet" literary work, but haven't necessarily bid a huge amount on the advance.

Whose permission do you have to get to bid and do they give you an upper limit?For me, I need to quickly get at least one or two positive reads within the editorial department, and then get the approval of the editorial director to distribute it to the rest of the committee--basically for us, the way auctions work is almost the same as the regular acquisitions process, but everything is sped up time-wise. Our publisher is allowed to authorize up to a certain amount, and if we think the auction will go above that amount, we have to get the CEO involved to sign off.

8 comments:

Awesome post. You talked a bit about how auctions worked at the SCBWI LA conference last year, and that was helpful. These Q's submitted by the other BRGs were awesome, too. Really insightful and to the point.

There's a variation on Rounds, at least in my limited experience with auctions -- auctions lasting only a predetermined number of rounds, after which both/all bidders may still be standing, and the decision may be decided only partially on the advance offered.

How common is this variation? And is the editor's approach to this version any different than from the two main types?

Okay here's a fun question for you...I have been doing some research on book advances for first time authors and found out that Stephenie Meyer the writer of the ahem...'Twilight' series was offered a 750,000$ advance for a 3-book deal. I heard it got this high because of a book auction (another publisher interested offered 350k)

Those are big numbers to throw around...to me anyway...can you share some insight as to WHY a publisher would offer soooo much to a first time (at the time) 'no name' writer? She wasn't previously famous...and although her book is highly commercial now there really wasn't a demand for that certain subgenre even though there was an apparent interest...so how could they possibly know it'd succeed? Why were they so generous?

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